Algoma Steel has some of the key insiders selling millions of dollars of their shares in the Sault Ste. Marie-based steelmaker, fuelling market interest and caution. Among the sellers are David Sgro, former CEO of Legato Merger Corp., and Michael McQuade, Algoma’s CEO at the time of last year’s merger with Legato Merger Corp.
In September, McQuade sold $2.05 million USD in Algoma stock at $10.16 per share reducing his stakes by 67%. Just days ago, Simplywall.st analysts noted this sale as the largest insider transaction for Algoma over the last twelve months. While insider sales at current market prices are commonplace enough, the sale’s price at $9.76 per share sent some people into a tizzy with analysts calling it a “cautious” but not threatening move.
Sgro, now a force to be reckoned with in Algoma’s boardroom as chair of its human resources and compensation committee, also had a big sales figure. On September 12, he sold $682,294 USD in Algoma shares after his earlier notification to the U.S. Securities and Exchange Commission of plans to unload $2.04 million USD. As of August, Sgro controlled about $8.1 million in Algoma stock.
The sales come amidst speculation that Algoma is negotiating with interested investors seeking to buy the steelmaker, though it remained silent in relation to the report.
McQuade and Sgro were important players in last year’s $1.7 billion merger between Algoma Steel and Legato Merger Corp., an operation that injected fresh capital of $306 million into the operations of Algoma. The directors of Algoma today, their decision to sell off huge portions of their holdings piques further curiosity about the future directions that the firm can take.
Also, Sgro’s experience with SPACs and navigating a complex mergers and acquisitions situation gives his latest maneuvers a lot more significance. SPACs, also known as “blank cheque companies,” raise money in an IPO to buy other businesses, and Sgro has led several SPACs and served on the boards of 14 public companies in North America.
Algoma’s two top managers’ reported insider stock sales are said without any comment on possible investor talks with the company when it is tight-lipped on the same. Anything can happen for the steel giant as the significant shifts may be in the offing.
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